Dan Sheridan’s Iron Condor Opening rules

Written on June 17, 2007 by OptionsRopeaDope

If you want to learn how to open an Iron Condor like an expert, be sure to set aside time regularly and watch the free CBOE educational webcasts. Especially the “Dan Sheridan’s Market Maker’s Guide to Income Generation.” It is chock full of real world trades, and rules that work. Here are Dan’s rules for an Iron Condor:

  • Look 30-70 days away from expiration.
  • Use strikes 10 points apart (for the SPX or S&P Futures options, his favorites)
  • If you insist on using a stock, choose one with volatility under 30, and price over $75/share.
  • For the call side, your short option should have a delta of 7-9, max (or .07-.09, depending on how you your software shows it.)
  • For the put side, the short put should have a delta of 6 max.
  • Leg in for best fills and credit - long call, long put, then shorts.

 

 

 

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    • Category Posted in Dan Sheridan, Trading Rules, Iron Condors

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